Recap of Previous GBP/USD Analysis:
Trend: Bullish (Higher highs/lows intact)
Strategy: Look for buy entries at purple zones (preferably false-break setups for higher win rates)
New Price Level: Minor Purple Zone (duo to new price action)
Formed Setup:
Price briefly dipped below support, triggering stops.
False breakout confirmed with a pullback, offering a high-probability long entry.
How to trade False Breakout setups?
Why This Works?
Educational Takeaway:
False Breakouts = High-Probability Traps: Price breaks support/resistance only to reverse and trap retail traders.
Trade in Trend Direction:
False breakouts with the trend (e.g., bullish GBP/USD) have higher win rates.
Always wait for close beyond the zone + confirmation candle.
Trend: Bullish (Higher highs/lows intact)
Strategy: Look for buy entries at purple zones (preferably false-break setups for higher win rates)
New Price Level: Minor Purple Zone (duo to new price action)
Formed Setup:
Price briefly dipped below support, triggering stops.
False breakout confirmed with a pullback, offering a high-probability long entry.
How to trade False Breakout setups?
- Entry: On pullback to the reclaimed purple zone (with bullish confirmation)
- Stop-loss: Below the pullback's low (invalidates the price structure)
- Target: Previous high or next resistance
Why This Works?
- Stop-Hunt Mechanism: Markets often "sweep" liquidity before reversing.
- Risk/Reward: Tight stop, clear upside potential.
Educational Takeaway:
False Breakouts = High-Probability Traps: Price breaks support/resistance only to reverse and trap retail traders.
Trade in Trend Direction:
False breakouts with the trend (e.g., bullish GBP/USD) have higher win rates.
Always wait for close beyond the zone + confirmation candle.
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.